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Surviving the Next 50+/- Years

The dazzling Misssy M seems to inspire a lot of blog posts for me. I don’t know why that should be so – I’ve never inspired any for her. But anyway, last week she posted a panicky little treatise on being forty and all the ways she reckons she should be different at such an advanced age.

The thing that particularly sparked my interest and concern, was her worry that neither she, nor her husband had much of a pension. How you’re going to survive in your old age is something that most young people don’t seem to give much thought to. It’s not until you start heading into your 40s that you suddenly begin to realize that you might just live another 40 years. Then you realize that you won’t want to keep working for another 40 years even if you could. Then you realize that if you’re not working you won’t have any money and that without money you won’t be able to do stuff like eat, pay your mortgage or sail around the world.

Some of us — though we whine about having worked non-stop for the last 20ish years in a boring government job, at least currently believe we have a fairly livable pension to look forward to. (Unless, of course, Harper decides to slash the pensions which we’ve been paying into and which are really the only reason most of us keep hanging on in the federal public service where the only real benefit anymore is a stable pension plan, despite what the public perception is of federal public servants as “fat cats”. So yes, let’s by all means bring government workers down to the level of the lowest common denominator instead of raising salaries and pensions in other industries.)

So, really a whole bunch of us have no real idea what our futures as old people is going to look like. Unless you’ve got a hefty and absolutely secure pension and/or have pumped most of your salary into RRSPs all your life and/or have some kick-ass investments and/or a giant inheritance, what are you going to live on after 60 or 65? Your federal/state/old age pension plan isn’t going to be enough to even keep you in cat food and hard candy. And what if you become ill or infirm and can’t look after yourself properly anymore? I’m sort of hyperventilating just thinking about it.

People in my age range are getting quite anxious about this question – especially those without a job-related pension. I’ve been kind of hoping that not only will I be able to continue to feed myself and pay my bills, but that I might also have a bit extra for some travel or other fun things once I don’t have to punch a clock anymore. But who knows?

Here are some options I’ve been considering:

Going to live somewhere warm. Right away that cuts my cost of living by 70%. And, sleeping in a cardboard box is so much more pleasant when you’re not surrounded by ice and snow.

Winning a lottery. While it sounds great in theory, I understand there is a good chance this will be difficult to put into practice.

Living off my child. It would be fun to spend my days embarrassing her even more than I already am by shuffling around the house in diapers and a grubby housecoat, cackling toothlessly at all her friends; but I suspect she’ll make me go live in the root cellar and I wouldn’t like that.

Robbing a bank. Now this is a win-win option. If I get away with it, I have a nice nest egg. If I don’t get away with it I get to go and live in one of those cute cottages at Grand Valley Institution for Women

That’s pretty much it for ideas on my end. How about you? How are you going to survive in your declining years?

I just always assumed I wouldn’t live very long what with all the beer and cigarettes. Also my husband is 6 years younger and plans to work until he is at least 65, so I’d be 71 but probably dead by then. I guess I’m living my retirement now since I haven’t worked since 1999. My plan seems sound enough.

everytime i threaten to leave my government job, everyone squeals “but what about the pension!!!” ugh.
and, my mom and dad are always booking trips and joking that they are spending my inheritence. soooo funny.
i have no idea how we’ll live after 55. but, it will be 55. not 60, not 65. it will be 55.

“let’s by all means bring government workers down to the level of the lowest common denominator instead of raising salaries and pensions in other industries.”

I’m guessing that the government was insulated from the downturn. I took a 5% pay cut so my company could continue to function.

We can’t raise our salaries or benefits, despite or best efforts we cannot compete with the US or the EU. And its not just my industry. I’ve had 6 jobs including this one. All my previous jobs don’t exist anymore because the companies don’t exist anymore.

We have a problem and I’m not sure how we are going to fix it…….other than moving south and living in a carboard box.

Dr. Monkey – Gee, that’s mighty nice of you. I think if I’m going to leave this country I’d want to go somewhere without so much snow, though…and without so many crazy people. But thanks. Do you have a nice room for me? I’ll need my own bathroom, too.

Chris – I keep forgetting to buy lottery tickets and I wouldn’t like to mess up my hair with a balaclava, so bank robbery could also be a problem.

Geewits – Brilliant! Die young and you don’t have to worry about supporting yourself in your old age. I’ll keep that one in mind.

Meanie – You take a big hit on the pension if you leave before 60. Big hit. But if you have some other sources of income, and you’ve got RESPs to cover the kids’ university tuitions you should be okay

Eyeteaguy – Nobody’s insulated from the “downturn”. Our pay increases over the last decade or so have been below cost of living increases and our next contract will probably just maintain the status quo. We’ve had staffing freezes and freezes on all expenditures. This means we’re working on ancient equipment and sitting on broken down furniture in underheated or overheated buildings. What people don’t understand about government employees is that we’ve traded a lot for some sort of job and pension security. Entry level jobs probably pay better than the private sector, but after that we are equal to or less than what could be earned privately. You can work your ass off in the government and you will never get promoted based on merit, you will never get bonuses or incentives, you will never be rich. There will be no gold watch when you retire, no Christmas bonuses, no gifts, no perks, no exotic business trips. And our day-to-day job gives little personal satisfaction. We are tiny cogs in a big, impersonal machine. Our work will rarely be recognized. We will never be movers or shakers.And we can be working hard on something for months only to have the whole thing cancelled all of a sudden with no explanation. Have you ever had to deal with a government department for anything? Were you frustrated? Whatever frustration you felt, multiply that by at least 10 and that’s what it’s like on the inside. But we stay because security is more important than all that stuff and that’s seriously the ONLY reason most of us are still here. And everybody hates us, mocks us and thinks we have such a cushy gig. All that being said, it’s horrible what’s happening in the private sector with people losing their livlihoods – I agree. But something constructive needs to be done to afford Canadians some sort of protection against this sort of thing happening — the answer is not to slash the industries that ARE functioniong so that we all end up in the creek without a paddle.

Yes yes there is no doubt that the way for all Canadians to benefit from a lifetime of work is to make sure that no one does.

Any law set up to ensure that banks and money lenders get first cut of any bankruptcies and that the workers can be shafted for the pensions that I might repeat, THEY HAVE EARNED, not been given is a law that is unjustified.

Big business is forever harping on all of us being competitive but then award extraordinary benefits on themselves while tut tutting regular workers.

So in fact the solution to a strong economy is not in fact in providing 5% of the population with a lavish life style but in providing 95% of the population with a decent living. This will be spent on frivolities like food, clothes, housing, etc and that will provide jobs and income for the next generation.
What a revolutionary idea.

I don’t want to get into a pissing match here but.
I haven’t got a costs of living increase or a raise since I’ve been here (7 years)
I have had a budget freeze 4 of those years.
I don’t have a staff anymore, I am it.
I am working on a 5 year old PC and my servers are 3.5 years old and out of warranty.
The chair I am sitting in I had to buy myself after my old one broke.
All that and I don’t have a pension, or decent medical.

Why am I still here? Because I can’t find anything better. And its not for lack of looking.

I work my ass off and never get noticed or promoted, no bonuses, gift, trips perk. The effing coffee machine I brought in from home.

I make a budget and it gets slashed for no reason. My projects get cancelled without explanation.

Dave – It’s an interesting phenomena when people look at their own jobs and the various ways they’re being shafted and reckon that what would make it better is if the people who have employers that treat them reasonably humanely would also get shafted. It’s like being in a marriage where you get beaten regularly, but instead of getting out of the marriage or taking some measures to stop your husband from beating you; you insist that all other wives get beaten too.

Eyeteaguy – Well, your employment situation sucks, that’s for sure. Nobody should have to work under such conditions in my opinion. There should be a national standard of some sort where people put their time, talents and effort into a company and they get rewarded with a livable salary and a livable pension in their old age. This is the 21st century and we are a rich country. Any corporation or business or country should at minimum invest that much in their employees. Slashing my pension will not help you achieve better job/pension security though. There are people working for minimum wage for employers who regularly berate them and make them feel like dirt. It might make them feel better if all our salaries were minimum wage and if all our employers treated us like dirt.

“Going to live somewhere warm. Right away that cuts my cost of living by 70%. And, sleeping in a cardboard box is so much more pleasant when you’re not surrounded by ice and snow.”

I seriously consider this every single winter! The winter here sucks so bad and I think how much easier it must be elsewhere since you don’t have to freeze your butt off!
As for your question-I don’t know how I am going to survive in my declining years, I’ve started investing but it never seems enough. Particularly when you consider the fact that my husband and I want to buy a house in the next few years! And houses cost an arm and a leg nowdays!

I am fortunate to have a good government job, and right now, it promises to pay a pension. If I choose to stay here until I can “retire” (whatever that means), there is potentially a good payout for me.

But I am not counting on it being there, because I have seen what the “Greed Generation” is doing to what many have considered to be a given.

Infrastructure is falling apart, manufacturing is leaving, and so forth. The rich continue to get richer at the expense of the rest of us.

But I refuse to let that bother me any longer, as it once did.

So as I can only speak for myself, I will offer up what I see is the workable solution for me.

I am working on at least two businesses in areas that interest me, that I can do from home, or a cafe, or the back of a rusty old pickup truck.

I know that without a mortgage, the income from either of these will be able to support me because I have decided that I will have modest needs.

I am considering moving to a much warmer location in order to do this. I may even have to learn a new language to make this work better (Spanish, if anyone is wondering).

Both businesses are service-based, either can be done from anywhere in the world.

Because the work interests me, I do not plan to retire.

Ever.

So I will not need a pension.

If I happen to receive some kind of payout from what I’ve put into the system, so much the better.

If not, I don’t really care, because I’m not counting on it being there.

I tell you this pension thing is really and seriously upsetting my husband and I. The main reason is that we HAVE been putting cash into these schemes all these years. But no-one ever really stays in the one company for life anymore and this is the problem. I have three frozen pensions- twenty years of contributions that won’t amount to bugger all. You are right to ask- what else is there to consider- because pension plans ain’t it.

I am putting faith in my children- I’ve already got my six year old to swear in front of witnesses that I can stay with her til the bitter end.

Pauline – A house used to cost and arm and a leg – now it costs two arms and two legs. And salaries haven’t kept up at all. One weeks’ pay from one person used to pay your housing expenses (mortage/rent, utilities). Now it’s a minimum of 2 weeks pay just for the basic mortgage or rental payment – all the other stuff is extra. So, in the average couple, one person is basically working just to cover housing expenses including maintenance, taxes, insurance, furniture, appliances, etc., etc. The other partner covers everything else. I don’t know how, at that rate, anyone can invest enough for their senior years. Is somebody in charge keeping track of all this I wonder??

Friar – I went to grad school too – not as long as you and I don’t have 20 years yet, but when I retire I will. In your shoes though I would look at some sort of self-employment scheme – like Brett. It’s something I think about anyway all the time just in case I can’t depend on my pension…which it looks like I might not be able to. Bastards.

Brett – Good for you. As I mentioned to Friar, that seems like the only really sensible solution to the whole problem of supporting yourself after 60/65. I’ve mulled over a variety of possibilities and haven’t yet struck on the perfect solution. Will you share your idea? You can email me urbanpedestrian@gmail.com and I promise not to move to Spain. The only fly in this self-employment scheme is if you become incapacitated in some way and can’t do the work. Eventually, you will begin to decline. Then what? Nursing homes cost a fortune.

MisssyM – None of your pensions are transferable? For a lot of organizations/companies here, if you really pursue it you can get all your pension contributions from other workplaces rolled into one. I suppose you’ve looked into it and had no luck though, eh? Can you get your contributions returned to you so you can invest them somewhere stable? Why am I offering financial advice? I know nothing.NOTHING.

@ Brett Legree
“If I happen to receive some kind of payout from what I’ve put into the system, so much the better.

If not, I don’t really care, because I’m not counting on it being there.”
This is what’s wrong with us. If you went to the bank today to withdraw some of “your” money and they said , oh sorry we changed the rules it’s ours now you’d have a holy fit. There would be rioting in the streets and the bankers would be running for the hills. but is some asshat with an MBA says there is nothing left for the pension you earned you shrug and say well I never expected it anyway. This is not some gift given to you for long suffering service it is part of the ages you are earning right this day. Demand that it be paid to you before the boss gets his bonus.

Oh, I agree with you – but, since I know that my government won’t respond to a peaceful protest on my part (I didn’t vote in the current lot of bastards, anyway), and I’m not willing to resort to guerrilla warfare, my position is one of “realism”.

I figure, no sense worrying whether or not it will be there for me, but instead I’ll plan on it *not* being there and if it is, I’ll have a bonus.

See what I mean? I expect them to make good on their promise to pay me out, but I’m not willing to trust that they do.

To be honest, I’ve often wondered why there haven’t been riots in the streets in the USA, with the bank bailouts at the same time as the massive foreclosures.

Yes Dave, it is stealing – and whether it is stealing from private sector employees (like Nortel) or public sector (like Harper is hinting), it is still stealing.
XUP – good points and I think I will print off this discussion and hand it to anyone who starts to harp about how easy we have it in the PS.
I worked private sector for 9 years between undergrad skule and grad skule (yeah, I have a coupla of those degree thingies too) and can fully understand the frustration that private sector employees – who are worried for their futures – must be feeling.
But the main point you make is that the solution is not to lower the standards in the public sector to meet the lower standards in the private sector. Aside from the CEOs and Boards of Directors who are paid for their performance (i.e., the bottom line), I don’t see how slashing PS pensions can help. Dude or dudette working for Company A is not going to see a difference in their pension because of cuts.
Just for the record, I can retire at 60 with a pension, but will take a significant penalty because I too started in the PS later in life. My wife is also a public servant who can retire as well at 60, but because of our 5 year age difference, I could retire 5 years earlier than she can.
But of course, she would kill me if I did that so I guess I’m working till I’m 65!

I am in my 40’s (like MissyM- great post) and panic at the thought of retiring. My Dad is in the advanced stages of Alzheimers and the cost to care for him properly, and provide support for my elderly Mom staggering. Forget retiring with a cushy lifestyle…I am hoping my husband and I have enough money that we can at least get decent medical care and/or help (knock on wood we won’t need it). Our experience here in Ontario, dealing with the medical system and private services makes me realize how easy it is to financially ruin a lifetime of savings and hard work. Most of my 40 something friends have little savings and most are counting on a pension of some sort. I worry our golden years are going to be anything but golden.

I’m thinking we all get together and found a Commune for Bloggers of a Certain Age and Uncertain Mental Stability. We’ll pool our meagre resources, split the bills and ALL wander around in dressing gowns and non-matching slippers muttering about spiders. It’ll be great.

I’m going to die well before then, I think. I eat a lot of cheese and sugar. I also smoke a lot. If I’m still around when I’m 50, I’ll rob something or as you said, live off my kids. Maybe rob my kids. I don’t know.

Cutting pensions wouldn’t be the only way this government made it harder for people to manage in 50 years.

Unless the world changes its emissions pathway significantly, it seems highly likely that acute and serious effects of dangerous climate change will have emerged globally by then. The Arctic will be ice-free in summer, almost surely, and all manner of disruptions, sea level rise, and stronger storms will be making life tough for everyone.

In short, people doing lifetime planning now have a whole bunch of new factors to consider, like whether that Florida condo will be underwater by the time they get the chance to move down there.

Brett – Thanks. You know people say that a lot – that they’ll find a way to die before they’ll let themselves get old and infirm, but when push comes to shove (so to speak) the oldies cling on to life no matter what the quality, with as much tenacity as any young person – most of them anyway.

Dave – Brett’s very cavalier about a lot of things right now. I think he may change his mind when it comes to the crunch.

Friar – Ya, and now our government is saying “hey, if those private sector dudes can get away with it, why can’t we? Think of all the money we’ll be saving if we can get those retired public servants off our payroll.” And the majority of Canadians will say “Hell yes! They’re a bunch of lazy overpaid drains on the economy anyway – cut ‘em loose.”

Trashy – Wouldn’t she love to come home to a clean house every day, with supper on the table and a fresh, frisky husband just itching to talk? I think it would be great. Working wouldn’t be quite so bad if you didn’t have to come home and do all the chores and errands and stuff during your free time.

MM – You’re not alone. The whole prospect of getting old is getting scarier and scarier these days.

Loth – You jest, but I think that’s actually a sensible answer for a lot of seniors –pooling their resources together and forming some sort of communal living thing.

Mayopie – Where have YOU been? Anyway, welcome back. Maybe give it a bit longer than 50. 50 is the new 30. So you can’t retire until you’re 80 anyway because 80 is the new 65 and 90 is the new dead. So after 80 you can start thinking about robbing your kids who will be about 40 then by which time 40 will be the new teens and they won’t have any money. Oh well. Do you have a Plan C?

Milan -I don’t think people realize that things are liable to change that quickly. When we hear “climate change”, we hear it thinking this is something that will creep upon the earth slowly over the 200, 400 or 600 years — not in our lifetime.

True enough – I suppose I only have my genetics as a guidepost. All four grandparents died very quickly and quietly (heart), no cancer or lingering stuff involved, so if I follow in their footsteps…

I may sound cavalier, that is true – however, with four kids, I don’t have any money really for the bank to withhold from me if they decide to be dickheads in the first place (!), so that scenario is unlikely to happen for quite some time, if it ever does.

My reality with four children is that I will *have* to work quite late into my life, or at least it is the reality I choose to live.

I also feel it depends on what you want, when you finally get there.

We don’t want to live in a mansion full of “don’t touch rooms” like our parents do. A crummy old trailer is sufficient for us.

And another thing (as a Singularitarian), I expect technology to “set us free” within my lifetime and then I won’t have to worry about it, I’ll be able to surf Maui well into my 800’s…

Brett – Your parents live in a mansion and you’re worried about money for your old age? The ‘rents aren’t going to be around forever, you know. So, unless you have a dozen siblings or so maybe you’ll inherit??

Jazz – I can’t imagine how much you’d have to put into RRSPs to get enough to live well for maybe 30 or more years after retirement. Is that even possible??

Lebowski – Why would your life suck bad if you became a JP? If I ever get married I want you to do the ceremony. That would make it almost meaningless. So it would be like not really getting married. Win-win.

I was hoping to get some hints from your commenters. But I am as lost as ever.
I used to worry about not having a pension, until some friends lost their jobs (both of them at age 60) at a certain auto maker and they ultimately lost their whole pension.
I have saved money over the years by not owning a house. And by not having kids. I’ve only owned a car for about 14 years.
I think maybe the not having kids may backfire on me.

Get a good Financial Advisor. Interview at least 10. Find one you like, that will educate you and that won’t charge you a big fee. Most FA get paid by funds not their clients. Use word of mouth, find who other (rich) people are using.

I just switched to a new guy and I like him a lot. He put a plan in place and set some goals for me. For me, this is what I wanted. For others, they may want a different approach.

Violetsky – You know how we keep joking about that villa in France? Well, I think an idea like that might not be too far-fetched. A small group of single gals pool their resources and set up independent yet inter-dependent living together. Communal living on some level is a lot cheaper than isolated living.

Brett – Sure why not? They pull all your skin and fat and meat and stuff off so all that’s really left is your innards and bones.

Violetsky – Not just savings on food – but we’d only need one kitchen, one set of appliances, one set of dishes, furniture, etc. Everyone kicks in for the rental or mortgage payment. You could probably get away with only one car. There’s a reason why students shack up together – we could learn something from them. Except I would want my own bedroom/sitting room and bathroom. And I wouldn’t want to feel obligated to share all my meals and outings and daily life with the other old biddies. There’s also the co-housing model which might work better for people who want to share expenses, but like their independence.

Brett – Absolutely. I look after myself pretty well – eat right, get lots of fresh air and exercise, etc., etc. I’ve rambled on enough about all that on this blog over the years.

You know, what you and Violetsky just talked about, I had talked about with my brother-in-law about 15 years ago (we married sisters, of course).

We had just about agreed that we should buy a big house out in the country, large enough to hold two families, and it would save us a bundle (one mortgage, only one home to heat, repair, electric, bulk food, always or almost always have daycare, etc.)

Brett – Ya, I’m sure the sisters had enough of living with each other. If I absolutely had to I might be able to live with one of my siblings, but definitely not any of the other 3. Communal living or cohousing is the way to go. Have you looked into cohousing? You own your own individual place, but the community is built so that some resources are shared to keep costs down. It’s an interesting concept.